I want to reach you
You been bought, been seen and been given to
I want to reach you
I want to reach you
ASHLEY, COMMANDING OFFICER.
I recall promising you guys another blog post. Hehe. So here we go, "Ashley, what are your new New Year's resolutions?" I'll tell you what they are:
1. Pay off debt and save money.
"How much debt do you have?"
Enough. Over my 26 years on earth I've accumulated student loan debt, credit card debt, car debt, credit card debt, student loan debt and more credit card debt.
I will say that the car that I drive is paid in full and has been since 2011. That, in itself, is a blessing.
I don't want to lead you wrong though. In comparison to most people our age, we really don't have that much debt. Trust me, we're grateful for the fact that immediately following college we were able to secure careers that were more than capable of sustaining us and our financial needs. We realize that many people don't have that guarantee.
Most websites I've researched state that people in their 20's have an AVERAGE of $45,000 in debt. WHOA. We don't have half that, but it's still a hinderance.
I don't know about ya'll, but I'd rather not and never say I did.
Soooooo, Timmy and I are on a kind of strict spending budget until we pay off unsecured debt and student loans. I think it could work for you too.
"How are you going to pay off your debt, Ashley?"
Very carefully and very deliberately.
So here we go, the formula!
First, we give 10-15% to God.
God has blessed us immensely with earning power, shelter, heat and every single thing we need to be healthy and happy. The best thing to do is to honor blessing with blessing. If you're worried about giving to a church "because I don't know where the money goes. It probably goes to that preacher's porsche"...A. Find a new church because obviously you can't trust the spending habits of your own or B. Consider giving to something else charitable....like a food pantry, women's shelter, homeless ministry, drug recovery programs, crisis pregnancy centers, missionaries, etc.
Also, if you can't give that percentage to God (or charity), then give what you can. Remember the widow (Mark 12:42). The point is, you think of others before your self. Give blessing to get blessing.
Second, we save 10%.
One thing my grandmother (coincidentally, the most frugal person I've ever met) always stressed to me while growing up was to pay myself first and to make sure that I had an emergency fund. Also, that I never spent my income to capability (no matter how low-earning my job was). Seriously, she told me this while I worked at FoodLion. I made 150 bucks every two weeks and walked out of her house at 16 years old with quite a nest egg (for someone who was 16, anyway).
I believe the worst thing a person can do is to be a slave to every penny they earn. We should always attempt to spend below our means. Always. Living paycheck to paycheck is sometimes necessary in this culture, but...you should make an attempt to put something away.
Again, if 10% isn't something you can do...start with 5% or even lower. The point is, put something away...even if it's 10 bucks a paycheck.
Then, DO NOT TOUCH IT. Watch it grow!
Third, we pay off the necessary bills.
This is the part where you need to do some soul searching. You need to ask yourself: What is really important and what can I get rid of?
Home Insurance/Renter's Insurance
Yep, that's about it.
Smart phone plans
Xbox Live, etc
Yeah, anything that you can live without, even if you don't want to live without it.
Now, I'm not going to sit here and lie to you. I have Cable, Internet, an iPhone and love me some Southern Living. HOWEVER, Timmy and I have had serious discussions about canceling cable and keeping a Netflix subscription which is only 8 bucks per month. Unfortunately, we are contracted into our phones. I recommend that if you can get out of that...do it. Seriously, smart phones are making society ignorant, but that's another rant for another day.
All these other things that can be gotten rid of and you just can't do it, (Darn you Game of Thrones, Walking Dead and southern cottage style decorating!!) they will fall into a category we're going to discuss in a moment.
Fourth, you kill the debt. FAST.
Cue Dave Ramsay! No seriously, I don't even know what this guy sounds like (I don't even know what he LOOKS like...I imagine him as Doctor Phil) I just know that he's got some principles that I've heard spewed in well-meaning and friendly company for years. He's got something right though. His programs have led a lot of people out of the clutches of debt. So, I have adopted my fair share of his teachings (though I have never actually heard him in my life). Anyway, it's common sense. Use your brain, you'll be alright.
I think good ol' Dave says you should pay off your smallest debt first and then add what you were paying (once the debt is paid off) to the payments of your next lowest debt. The snowball effect or something of that nature.
Well, I do things a TAD differently. I pay what has the dang highest interest off first. Ha. Take that!
Why am I going to sit around and let a credit card with a 10% APR accumulate interest while I'm paying off a debt that has a 0% interest rate? Stupid.
However, make sure you know that if you have a 0% interest rate or financing that you pay off the amount owed before any offers attached to it expire. Now, if your offer expires in a month? Yeah, I'd focus on that.
Seriously though, you need to find what works best for you here. What debt is causing more debt? What needs to be paid off first?
For us, it's the stuff gaining interest.
Sorry for the tangent.
When you determine what debt needs to be paid off first, give it all you can.
"How do I determine how much I can pay off?"
Fifth, you give yourself CASH allowance.
Out of this cash allowance comes everything else you need and want. Including, but not limited to, clothing, gas, groceries, gym memberships, date nights, The Walking Dead, Game of Thrones and Southern Living, etc.
My husband and I have recently started budgeting this money into envelopes that coincide with what they should be spent on.
We have envelopes for: allowance, food, gas, date night, household sharing (cleaning goods, etc) and the barber shop (side effect of being married to the military). Once that cash is gone...it. is. gone. So, spend well.
These envelopes should contain the absolute LOWEST amount of money you can get by on. Trust me, you can get by on a lot less than you lead yourself to believe. Learn to coupon, learn what's important.
The number you have left...THROW IT AT YOUR DEBT.
Sixth, lock up your credit/debit cards.
Our credit cards are in the gun safe, we shred them when they're paid off (keeping one copy, in case of emergencies, in the gun safe). Put your debit card in the trunk of your car (or somewhere that you can't easily access it. Get it out of your wallet). This way, you are less tempted to spend.
For instance, if you're in Target, and you're all like..."I just NEED this $50 quilted bed throw!" and/or at Palmetto State Armory and are like, "I need this new scope for the AR15!"; you'll have to go out to your car in the pouring rain or go home and unlock your safe to get the stupid card out. By the time you've done all that...you think about what you really need, and how ignorant you're being.
Or like my grandma always said, "Wait three days and then ask yourself if you still want it." I don't know why the magical delineation of three days, but there you have it. Wait at least three days, grandmas can't tell lies.
"How do you keep up with all this?!"
Glad you asked. I mostly do it all in my head, but this year I've used the help of some tools to keep up with everything in once place.
What you will need:
3 Ring Binder
Tab Dividers (I have 16) with pockets on both sides
The nifty little pocket protectors that you used to use for presentations in high school
Loose leave paper
There are TONS of online resources for printing out your own budget material. I used a number of these sites to get exactly those tools that were necessary.
Monthly Budget Printable
Like everything you ever need for budget printables
Oh look! More printables!
Here's some printable yearly calendars too!
checkbook registers (seriously, you don't have to PAY for these)
My binder is set up as such:
I've got my average percentages sheet in the front.
Behind that is a coupon folder ( I keep up with those).
Then, a bill payment checklist, so that I know what bills I've paid.
Each tab is labeled with a month (x12 months)
The remaining dividers are labeled: Debt (for which I keep track of all the debt I pay off), Savings (for which I keep up with my savings totals, we have two savings accounts [emergency and vacation]), photography (so I can keep up with how much I have brought in over my regular income in donations, those donations also go to debt and photography equipment as needed); tax receipts (to keep up with barber shop visits, scrubs and any itemized deductions from the year).
I have two pocket protectors for each month:
The first keeps my monthly calendar with when bills are due labeled, as well as paydays. Behind that is my monthly budget.
The second keeps my check book register, and behind that is an expense tracker (that I keep for my personal use for cash allowance, so I can see where money is going).
When you open up the tab for the month there is a pocket on the divider, one side is bills to be paid, and then the other side are paid bills.
Yeah, not my finest photography, but you get my point.
Anyway, since this post was about 6 light years long (light years measure distance, btw), I'll get to my other goals in a later post.
I promise I'm getting better about posting!
It's a goal!
Verse of the Day:
-Mark 12:43-44 (NIV)
Song of the Day:
Protection by Future of Forestry